Risk analysis for sustainable supplier selection

Abstract

One of the important factors to survive in a competitive market is sustainable supplier selection. It is especially important because suppliers, who consider three dimensions of sustainability,namely economic, social, and environmental, are upstream players in the supply chain. Considering risk to choose the best supplier may lead to a more extensive and complex sustainable supplier selection process. Therefore, not only will the supplier selected by its performance but also by considering the unexpected deviations. In particular, to tackle this issue, this paper proposes a sustainable supplier selection model by integrating the DEMATEL-ANP and FMEA methods by considering supplier risk in the decision process. The result shows that the best supplier which aligns with the criteria for selecting sustainable suppliers. Moreover, it has a smaller risk compared to other suppliers. As a representative in this research is a pharmaceutical company.